How Premiums Are Calculated

Vehicle Factors That Affect Premium

The make, model, age, and value of the vehicle are the single biggest factor. Value drives the potential payout, and parts and labour costs drive repair claims. Expensive and high-performance vehicles cost more to repair and attract more risk-loading.

Theft risk is rated separately and heavily. High-theft vehicles — Toyota Hilux, VW Polo, Ford Ranger and similar perennial targets on the SAPS most-stolen list — carry higher premiums and often a tracking requirement. Older vehicles can attract lower comprehensive premiums but may be written off more readily after a moderate accident.

Driver Factors

Age and licence duration are the strongest driver inputs. Drivers under 25, and newly licensed drivers of any age, pay materially more because their claims frequency is higher. A long, clean licence history lowers the rate.

Insurers also commonly rate on factors such as marital status, occupation, and sometimes qualifications or home ownership, each used as a statistical proxy for claims behaviour. The named regular driver matters too — listing a higher-risk regular driver raises the premium, and not listing one who actually drives the car risks the claim.

Area and Parking Factors

Your address sets the area risk. Insurers map theft, hijacking, and accident frequency to a suburb or even street level, so the same car costs different amounts to insure in different areas.

Where the car sleeps is rated alongside the address. A locked garage overnight rates better than a driveway behind a gate, which in turn rates better than open street parking. Day parking — secure office basement versus an open lot — is also asked and used.

Usage Factors

Private use is the cheapest class. Business use, e-hailing (Uber, Bolt), and delivery use each add risk-loading for the extra time, mileage and environments involved.

Annual mileage is a direct lever: a car doing 10,000 km a year is exposed to far less risk than one doing 35,000 km, and insurers price that gap. Estimating mileage honestly keeps the claim sound while not over-paying.

Claims and Cover History

Past claims raise the premium. A clean multi-year claims record typically earns the maximum no-claim bonus, while a recent at-fault claim can lift the renewal premium for a cycle or more. A continuous insurance history (no gaps) also tends to help.

Cover, Excess and Tracking

The cover type sets the base: comprehensive costs more than third-party, fire and theft, which costs more than third-party only. The excess you accept moves the premium inversely — a higher voluntary excess lowers the monthly premium because you carry more of each claim.

Tracking can both lower the premium and be a condition of cover on theft-prone vehicles. An approved, active tracker reduces the insurer's theft exposure and is often rewarded in the rate, while its absence on a required vehicle can compromise a theft claim.

How to Lower Your Premium

The legitimate levers are: choose a sensible voluntary excess, keep the value basis appropriate to the car's age, fit an approved tracker where it helps, park securely and declare it, keep your driver and mileage details accurate, and maintain a clean, continuous claims record. Never under-declare use, mileage, or drivers to cut the premium — it saves a little now and risks the whole claim later.

Then compare. Insurers weight these factors differently, so the same risk profile produces materially different premiums across the market — which is the entire reason to compare rather than auto-renew.